A Step by Step Guide To Amazon PPC
What is Amazon PPC? Amazon allows third-party sellers to buy sponsored ads on their product
What is Amazon PPC?
Amazon allows third-party sellers to buy sponsored ads on their product listing pages. If you sell products on Amazon you can pay Amazon so your product shows up on top of their pages. You can choose which pages your ad appears based on a customer's keyword search or product category.
Ads are sold with a pay-per-click model (PPC) and cost is determined via targeted keyword bidding. With proper management and optimized strategic planning of your Amazon PPC campaigns your products can gain great traction and increased sales conversion. You can stand out above your competitors and more popular items or brands in your category. Amazon-sponsored product ads are especially useful for new product launches with no sales or review history.
How does the Amazon PPC auction work?
Amazon PPC auction works similarly to Google PPC auction. You submit a bid on keywords and then compete with other advertisers for the ad space.
Your cost per click needs to be 0.01 above your competitor's next lowest bid. So for instance your bid is $1.00 and the next lowest bid is $0.75 you will pay $0.76.
When should I launch Amazon PPC ads?
It’s best to launch your Amazon PPC ads as soon as you create a new listing. Besides getting more exposure to your new product, you want to start collecting data on the product, as more data comes in you can slowly but surely optimize your Amazon ads campaign accordingly.
Is Amazon PPC worth it?
As more consumers start their shopping on Amazon more and more vendors and brands are competing for the product listing page. So by advertising your Amazon listing, you will put many more eyeballs on your Amazon product page.
According to Amazon’s internal data, products with sponsored ads saw a +40% increase in units ordered and a 54% increase in glance views. We here at IGPPC see an average of a 200% increase in sales per client. Some customer have actually increased their sales by over 1000%. There are over 300 million products sold on Amazon and your listing can easily get lost among your competitors so with a good PPC plan you can reach millions of potential new clients the potential is huge.
Why should I try Amazon PPC?
Because the entry fee is very low, you can customize your PPC as more data and sales come in. You can start as low as $5 and gradually increase it. The investment and ease of placing bids are low and with minimal risk.
What are the Amazon Ads Pricing/Fees?
Amazon ad prices are set via a keyword auction so prices can fluctuate based on your industry, category, and season. You can start paying from 0.01 to several dollars.
Top 7 Benefits of Using Amazon PPC Sponsored Ads
- Increases your product sales
- Boosts your organic rankings on Amazon
- Creates brand awareness
- Avoid competitors from snatching positions
- Helps you get the Amazon buy box
- Gain momentum during seasonal sales
- Get immediate exposure for new product launches
The 3 Types of Amazon Ads
1) Sponsored Products
Sponsored product ads are displayed on Amazon product listing pages or search results listing pages. Your product will be displayed on top just like the other items with a sponsored tag in the listing. This type of ad you will use when starting out.
2) Sponsored Brands
You can advertise your brand’s storefront or a collection of your products on top of Amazon’s SERP. You can also use video ads in your sponsored brand's ad.
3) Sponsored Display
Amazon-sponsored display ads are audience-based marketing you can target specific demographics, and genders or retarget a visitor to your product. The ads will run on both Amazon and outside websites.
Amazon PPC Keyword Bidding Match Terms You Need to Know
Broad match
When choosing a broad match for your Amazon keyword your ad will show anytime your keyword matches a search term no matter the sequence so for instance if your keyword is “Women’s Shoes” your ad will show for “Women’s Flat Red Shoes“. as long as your keyword is within the phrase.
Phrase match
Amazon will only display your ad when your entire keyword phrase matches in the exact order in the search term but might have other words before or after. For instance, if your keyword is “Women’s Shoes” your ad will only show when someone searches for “Red Women’s Shoes” or “Women’s Shoes high heels” but not “Women’s Winter Shoes“.
Exact match
Your Amazon ad will only show when someone searches with exact keywords for instance if your Keyword is “Women’s Shoes” you ad will only show when someone searches for “Women’s Shoes” and not “Red Women’s Shoes”.
Negative keywords
You can set up keyword terms that will prevent your ad from appearing if used in a search phrase
for instance, when advertising men’s shoes you would want to add the keyword “women” as a negative keyword to prevent your ads from showing up when someone is searching for women’s shoes.
There are 3 Types of Biddings for Amazon PPC
1) Fixed bidding
Amazon will not adjust your bid price and will only display your ad when your bid price matches.
2) Dynamic bidding – down
Amazon will lower your bid price if it considers the purchase probability to be low.
3) Dynamic bidding – up and down
This is the most popular bidding strategy, Amazon’s algorithm will raise or lower your bid based on the likelihood of the potential click converting to a sale. That means they will increase your bids in real-time over your competitor to help you win impressions that may be more likely to convert to a sale, or they will reduce your bids that are less likely to convert to a sale.
Amazon PPC terms you need to know
Impressions
When your ad appears on the Amazon listing page it’s called an impression.
Clicks
When someone clicks on your ad. You are only charged by clicks not impressions.
Amazon Key Performance Indicators or KPIs
ACoS
Amazon advertising cost of sales (ACOS) is a measurement of the efficacy of your Amazon advertising campaigns. It compares the amount you spent on a PPC campaign to the amount earned. This is a very important metric to measure to make sure your campaigns are the cost-efficient .For a more comprehensive understanding of Amazon ACOS and other Amazon cost-per-sale metrics, read: What is Amazon ACOS?
CPC
Cost-per-click – This metric measures the average cost per click for your Amazon PPC campaigns. You want to be very strategic about this because you don’t want to go too high and lose profit but you also don’t want to lose out on a promising lead. You should decide on the cost based on your objective
CTR
Click-through-rates are the rate at which a customer clicks on your ad when displayed on his/her Amazon page. So it’s “impressions” divided by “clicks” = CTR.
Conversion rate
The rate of how many times your ad converts to a sale. “Clicks” divided by “units” sold = conversion rate. You obviously should always optimize your Amazon campaigns to increase your conversion rate.
What You Will Need to Get Started with Amazon PPC?
- A valid Amazon-approved product
- Good product description and product images
- A credit card
- A list of keywords you want to bid on
Key Takeaways
The ease and cheap entry into Amazon PPC advertising make it a must for any Amazon reseller marketing department to try out. Your ad spending can be tied to clicks and sales performance and can be adjusted and tweaked constantly according to your business needs, you start small and grow as you analyze the data of your campaigns.
Related Topic: Amazon SEO: How to Optimize and Rank Your Product Listings Higher on Amazon Searches
Should you manage your PPC or Outsource to an Amazon PPC Agency?
Amazon PPC campaigns require constant fine tunings and adaptions you must read and analyze your data and update or change marketing objectives accordingly. By hiring a trusted Amazon PPC agency you get the peace of mind that your campaigns will always be optimized and cost-efficient. In addition, you will also get great advice and strategy which will help you increase your Amazon sales volume.
Amazon ecosystem is constantly changing and fine-tuned so having a trusted advisor to consult with might be a great benefit to your Amazon marketplace business, it will free up your time to focus on product development and other areas of your business.
Get your free comprehensive audit from our friends at IG PPC today.